No ‘Payday’ Yet for A-Es

The article “With Retainage Mandate Gone, A-Es Look Forward to Payday” seems to suggest that retainage on federal contracts is no longer an issue. While the new rule is a step in the right direction by making retainage “optional,” the fact is that federal contracting officers still may resort to this practice at whim.

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The rule states, “The contracting officer can withhold up to 10% of the payment due in any billing period, when the contracting officer determines that such a withholding is necessary to protect the Government’s interest.” We would like to see this practice eliminated altogether. The government has many other remedies for ensuring satisfactory completion that are less damaging to our businesses.

The new rule change also doesn’t apply to A-Es serving as subs to contractors on federal projects; they will continue to have to “check in” on a regular basis to inquire whether the contractor has been paid in full. We still have a way to go on this issue. It’s not “payday” yet.

David A. Raymond
President,
American Council of Engineering Companies
Washington, D.C.

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